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editorial

Mideast investment plan helps, but can’t substitute for peace

At the World Economic Forum in Jordan, Secretary of State John Kerry waded into the muddy waters of the Middle East peace process by highlighting an international effort to attract $4 billion in private investment to Palestinian territories. He sketched out a sweeping vision of infrastructure projects that would allow Palestinians to produce their own energy and water, freeing them from dependence on Israel for those needs. He spoke of unleashing the transformative economic potential of Palestinian areas that could increase their gross domestic product by 50 percent, cut employment by two-thirds, and free Palestinians from chronic reliance on foreign aid.

Kerry’s plan is a creative attempt to make progress on the economic front, even as the stalemate on the political front drags on. He is trying to build on one of the few positive trends in the conflict: increasing cooperation between Israeli and Palestinian businessmen. The investment plan is backed by Yossi Vardi, the godfather of Israel’s high-tech sector, and Munib Masri, a Palestinian oil mogul, who have used business to try to bridge the gap between Israelis and Palestinians.

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Nonetheless, Kerry’s focus on boosting the Palestinian economy is no substitute for restarting the peace talks. Palestinians have long resisted the notion put forth by Israeli Prime Minister Benjamin Netanyahu that “economic peace” should take priority over a political one. After Kerry’s speech, Mohammad Mustafa, economic adviser to Palestinian president Mahmud Abbas, said Palestinians would never make political concessions “in exchange for economic benefits.” Kerry should make it clear that he doesn’t expect them to. He should spell out exactly how economic progress can help put the parties get back to a path of fruitful negotiations.

Kerry should also say how this investment plan — which is still very much a work in progress — will be different from previous economic efforts. History is littered with examples of ambitious ventures in Palestinian territories — industrial parks, greenhouses, power plants — that have fallen victim to this intractable conflict. Many of the projects that Kerry is championing have not been built in the past because Israelis, citing security concerns, have not given Palestinians permission to develop land or build roads to take their goods to market.

Until the political uncertainty ends, Palestinians won’t be able to achieve the prosperity or independence that Kerry describes. But the instinct to support businesspeople like Vardi and Masri is a good one. Both Israelis and Palestinians would benefit from the unfettered ability to sell to customers across the political divide. Investing in peace might make more sense to both communities if people better understood how it could improve their bottom lines.

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